Trump declares war with Iran "over" this weekend; will Islamabad become a turning point for global peace? Oil price plunge signals are already emerging.
2026-04-17 16:01:20
When Trump declared that "the war with Iran should end soon" and hinted at a possible key meeting between the US and Iran in Islamabad over the weekend, the market briefly saw a glimmer of hope for peace. However, due to strong investor uncertainty regarding the details of the agreement, the extent of compromise on the nuclear issue, and the duration of the ceasefire, international oil prices did not plummet as some had predicted during the Asian and European sessions on Friday (April 17), but instead retreated slightly. Despite the optimistic expectations brought by diplomatic progress, the market is still awaiting more substantial signals, and when freedom of navigation will truly be restored in the Strait of Hormuz remains the core variable determining the direction of oil prices.
US President Donald Trump has recently stated publicly on multiple occasions that he is confident of ending the war with Iran and believes an agreement will be reached soon. He emphasized that Iran also hopes to resolve the issue through negotiations, therefore the long-running conflict "should be over soon." Speaking to reporters outside the White House, Trump indicated that the next meeting between the US and Iran is likely to take place this weekend, and the current two-week temporary ceasefire agreement may not need to be extended, as the two sides are close to reaching a substantial consensus.
Trump further hinted that he might personally travel to Islamabad, the capital of Pakistan, to attend the signing of a final agreement. Hours later, in Las Vegas, he reiterated his assessment that the war was nearing its end. This statement sent a strong positive signal, demonstrating the US leadership's expectation for a diplomatic solution to the dispute.
Meanwhile, a 10-day ceasefire agreement between Lebanon and Israel officially took effect on Thursday. Trump stated that he had spoken separately with Israeli Prime Minister Netanyahu and Lebanese President Aoun, and planned to invite both leaders to the White House for "meaningful talks" in the next week or two. Iran insists that any comprehensive peace agreement must cover the conflict in Lebanon, and this ceasefire is seen as part of an understanding reached under Pakistan's mediation.
Trump also posted on social media, urging Hezbollah, an Iranian-backed militant group in Lebanon, to exercise restraint at this critical juncture. He wrote that if Hezbollah could abide by the ceasefire agreement and avoid further conflict, it would be a great moment, finally achieving regional peace and ending unnecessary killing. However, the ceasefire remains fragile, with the Lebanese army reporting intermittent shelling of villages in southern Lebanon by Israeli forces, which Israel claims is a response to Hezbollah's continued activities.
Pakistan has played a key mediating role in the recent US-Iran peace talks. A Pakistani source involved in the mediation revealed that significant progress has been made in behind-the-scenes diplomacy, and an upcoming meeting between the two sides is expected to push for an agreement. According to the source, the two sides will first sign a memorandum of understanding, followed by a comprehensive agreement within 60 days. Detailed technical details will be negotiated in later stages, while the two sides have already reached an agreement on matters of principle.
Other diplomatic sources indicated that Pakistan's chief mediator, Army Chief of Staff Field Marshal Asim Munir, has been consulting in Tehran since Wednesday and has achieved breakthroughs on some thorny issues. Pakistan's efforts have provided an important bridge of communication between the US and Iran, and Islamabad is likely to be the location for future agreement signings, highlighting the country's unique role in regional diplomacy.
Iran's nuclear ambitions have become a key sticking point in negotiations. During talks in Islamabad last weekend, the United States proposed that Iran suspend all nuclear activities for up to 20 years, while Iran proposed a suspension of three to five years. Trump stated on Thursday that Iran has offered not to possess nuclear weapons for more than 20 years.
Furthermore, Washington insists on the removal of all enriched nuclear material from Iran, while Tehran demands the lifting of international sanctions against the country. Two Iranian sources revealed that there are signs of compromise on the issue of highly enriched uranium stockpiles, with Tehran considering moving some of its stockpiles out of the country. While these differences remain, the negotiation process shows the possibility of gradual bridging.
Oil prices have fallen below $100 this week, fueled by optimism that the Middle East conflict may be nearing its end. Although the MSCI Asia Pacific ex-Japan index fell slightly by 0.8% due to profit-taking, and Japan's Nikkei index dropped 1%, overall market sentiment remains positive, with the index nearing its highest level since the start of the Iran-Iraq war. On Thursday, US stocks failed to recover all losses since the Iran-Iraq war and even set new record highs.
France and Britain will co-host a meeting of about 40 countries to signal to the United States that its close allies are ready to assist in restoring freedom of navigation in the Strait of Hormuz when conditions permit. Since the outbreak of the conflict, Iran has essentially blocked the strait, allowing only its own vessels to pass, while the United States subsequently imposed a blockade on ships entering and leaving Iranian ports and called on other countries to cooperate.
Based on information from various sources, Trump's assessment that the war with Iran would "end soon," along with the active mediation efforts of Pakistan and other parties, has brought a rare opportunity for easing tensions in the region. Although the ceasefire in Lebanon still faces challenges, and core differences such as the nuclear issue require further negotiation, the possibility of a meeting this weekend and the prospect of signing a memorandum of understanding offer hope that a peace agreement is gradually taking shape. The restoration of freedom of navigation in the Strait of Hormuz will have a positive impact on the global energy market, while the conclusion of a comprehensive agreement is expected to bring lasting stability to the war-torn Middle East.
The developments in the coming days are crucial. If all parties can continue to demonstrate sincerity and flexibility, this conflict may end in a diplomatic victory, injecting more confidence into the international community.
Impact on Oil Prices <br />Trump's announcement that the war with Iran might end soon, and his hint that an agreement might be signed in Islamabad over the weekend, had a direct and significant negative impact on international oil prices. Since the outbreak of the conflict, the Strait of Hormuz has been essentially blocked, disrupting about one-fifth of global oil shipments. Brent crude oil prices surged from pre-war levels, reaching a high of around $120. Now, with the ceasefire agreement in Lebanon taking effect, Pakistan's active mediation, and a clearer outlook for the US-Iran summit, market optimism has rapidly increased. Oil prices have fallen back below $100, but market sentiment remains cautious. On Friday, international oil prices fluctuated narrowly in Asian trading, with Brent crude futures currently hovering around $98.5 per barrel.
In the medium term, if a peace agreement is successfully reached and normal freedom of navigation is restored in the Strait of Hormuz, international oil prices are expected to face further downward pressure. The resumption of Iranian oil exports, the gradual repair of regional infrastructure, and the normalization of global supply chains will increase market supply and alleviate the supply shortage pressure caused by the blockade. At the same time, the war risk premium will subside significantly, and speculative funds may shift from bullish to wait-and-see or profit-taking, further driving price corrections. However, the recovery process will not be instantaneous. Even if the strait is opened immediately, the damage to refining facilities, the backlog of ships, and the reconstruction of logistics will still take weeks to months. In the short term, oil prices may remain somewhat volatile rather than instantly returning to pre-war lows.
Overall, this diplomatic progress has provided significant downside potential for oil prices, helping to alleviate global energy inflationary pressures and boost economic recovery expectations. However, the ultimate impact will depend on the speed of implementation of the agreement's details, the extent to which core differences such as the nuclear issue are resolved, and whether geopolitical risks are completely eliminated. If negotiations falter, oil prices may rebound again; conversely, stability and peace will inject long-term positive factors into the international oil market, gradually pushing prices towards an equilibrium level dominated by supply and demand fundamentals.
At 15:59 Beijing time, Brent crude oil was trading at $98.45 per barrel.
Trump optimistically states: The war is about to end.
US President Donald Trump has recently stated publicly on multiple occasions that he is confident of ending the war with Iran and believes an agreement will be reached soon. He emphasized that Iran also hopes to resolve the issue through negotiations, therefore the long-running conflict "should be over soon." Speaking to reporters outside the White House, Trump indicated that the next meeting between the US and Iran is likely to take place this weekend, and the current two-week temporary ceasefire agreement may not need to be extended, as the two sides are close to reaching a substantial consensus.
Trump further hinted that he might personally travel to Islamabad, the capital of Pakistan, to attend the signing of a final agreement. Hours later, in Las Vegas, he reiterated his assessment that the war was nearing its end. This statement sent a strong positive signal, demonstrating the US leadership's expectation for a diplomatic solution to the dispute.
The ceasefire in Lebanon has officially taken effect, and Hezbollah has been urged to exercise restraint.
Meanwhile, a 10-day ceasefire agreement between Lebanon and Israel officially took effect on Thursday. Trump stated that he had spoken separately with Israeli Prime Minister Netanyahu and Lebanese President Aoun, and planned to invite both leaders to the White House for "meaningful talks" in the next week or two. Iran insists that any comprehensive peace agreement must cover the conflict in Lebanon, and this ceasefire is seen as part of an understanding reached under Pakistan's mediation.
Trump also posted on social media, urging Hezbollah, an Iranian-backed militant group in Lebanon, to exercise restraint at this critical juncture. He wrote that if Hezbollah could abide by the ceasefire agreement and avoid further conflict, it would be a great moment, finally achieving regional peace and ending unnecessary killing. However, the ceasefire remains fragile, with the Lebanese army reporting intermittent shelling of villages in southern Lebanon by Israeli forces, which Israel claims is a response to Hezbollah's continued activities.
Pakistan is actively mediating, and Islamabad may become the site for the signing of the agreement.
Pakistan has played a key mediating role in the recent US-Iran peace talks. A Pakistani source involved in the mediation revealed that significant progress has been made in behind-the-scenes diplomacy, and an upcoming meeting between the two sides is expected to push for an agreement. According to the source, the two sides will first sign a memorandum of understanding, followed by a comprehensive agreement within 60 days. Detailed technical details will be negotiated in later stages, while the two sides have already reached an agreement on matters of principle.
Other diplomatic sources indicated that Pakistan's chief mediator, Army Chief of Staff Field Marshal Asim Munir, has been consulting in Tehran since Wednesday and has achieved breakthroughs on some thorny issues. Pakistan's efforts have provided an important bridge of communication between the US and Iran, and Islamabad is likely to be the location for future agreement signings, highlighting the country's unique role in regional diplomacy.
The nuclear issue remains the core of the negotiations, and there is room for compromise between the two sides.
Iran's nuclear ambitions have become a key sticking point in negotiations. During talks in Islamabad last weekend, the United States proposed that Iran suspend all nuclear activities for up to 20 years, while Iran proposed a suspension of three to five years. Trump stated on Thursday that Iran has offered not to possess nuclear weapons for more than 20 years.
Furthermore, Washington insists on the removal of all enriched nuclear material from Iran, while Tehran demands the lifting of international sanctions against the country. Two Iranian sources revealed that there are signs of compromise on the issue of highly enriched uranium stockpiles, with Tehran considering moving some of its stockpiles out of the country. While these differences remain, the negotiation process shows the possibility of gradual bridging.
Market optimism is rising.
Oil prices have fallen below $100 this week, fueled by optimism that the Middle East conflict may be nearing its end. Although the MSCI Asia Pacific ex-Japan index fell slightly by 0.8% due to profit-taking, and Japan's Nikkei index dropped 1%, overall market sentiment remains positive, with the index nearing its highest level since the start of the Iran-Iraq war. On Thursday, US stocks failed to recover all losses since the Iran-Iraq war and even set new record highs.
France and Britain will co-host a meeting of about 40 countries to signal to the United States that its close allies are ready to assist in restoring freedom of navigation in the Strait of Hormuz when conditions permit. Since the outbreak of the conflict, Iran has essentially blocked the strait, allowing only its own vessels to pass, while the United States subsequently imposed a blockade on ships entering and leaving Iranian ports and called on other countries to cooperate.
In conclusion, with intensive diplomatic efforts underway, the prospects for peace in the Middle East are promising.
Based on information from various sources, Trump's assessment that the war with Iran would "end soon," along with the active mediation efforts of Pakistan and other parties, has brought a rare opportunity for easing tensions in the region. Although the ceasefire in Lebanon still faces challenges, and core differences such as the nuclear issue require further negotiation, the possibility of a meeting this weekend and the prospect of signing a memorandum of understanding offer hope that a peace agreement is gradually taking shape. The restoration of freedom of navigation in the Strait of Hormuz will have a positive impact on the global energy market, while the conclusion of a comprehensive agreement is expected to bring lasting stability to the war-torn Middle East.
The developments in the coming days are crucial. If all parties can continue to demonstrate sincerity and flexibility, this conflict may end in a diplomatic victory, injecting more confidence into the international community.
Impact on Oil Prices <br />Trump's announcement that the war with Iran might end soon, and his hint that an agreement might be signed in Islamabad over the weekend, had a direct and significant negative impact on international oil prices. Since the outbreak of the conflict, the Strait of Hormuz has been essentially blocked, disrupting about one-fifth of global oil shipments. Brent crude oil prices surged from pre-war levels, reaching a high of around $120. Now, with the ceasefire agreement in Lebanon taking effect, Pakistan's active mediation, and a clearer outlook for the US-Iran summit, market optimism has rapidly increased. Oil prices have fallen back below $100, but market sentiment remains cautious. On Friday, international oil prices fluctuated narrowly in Asian trading, with Brent crude futures currently hovering around $98.5 per barrel.
In the medium term, if a peace agreement is successfully reached and normal freedom of navigation is restored in the Strait of Hormuz, international oil prices are expected to face further downward pressure. The resumption of Iranian oil exports, the gradual repair of regional infrastructure, and the normalization of global supply chains will increase market supply and alleviate the supply shortage pressure caused by the blockade. At the same time, the war risk premium will subside significantly, and speculative funds may shift from bullish to wait-and-see or profit-taking, further driving price corrections. However, the recovery process will not be instantaneous. Even if the strait is opened immediately, the damage to refining facilities, the backlog of ships, and the reconstruction of logistics will still take weeks to months. In the short term, oil prices may remain somewhat volatile rather than instantly returning to pre-war lows.
Overall, this diplomatic progress has provided significant downside potential for oil prices, helping to alleviate global energy inflationary pressures and boost economic recovery expectations. However, the ultimate impact will depend on the speed of implementation of the agreement's details, the extent to which core differences such as the nuclear issue are resolved, and whether geopolitical risks are completely eliminated. If negotiations falter, oil prices may rebound again; conversely, stability and peace will inject long-term positive factors into the international oil market, gradually pushing prices towards an equilibrium level dominated by supply and demand fundamentals.
At 15:59 Beijing time, Brent crude oil was trading at $98.45 per barrel.
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